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Seventh Circuit issues new ruling on chapter 11 bankruptcy standing

The Court of Appeals in Chicago held on April 23, 2014, that an insurance company did not have standing to object to a chapter 11 debtor’s settlement with another insurance company because the objecting insurer did not suffer a direct pecuniary loss as a result of the settlement. The case involved the C.P. Hall Company, which FactorLaw represented when it was in chapter 11. C.P. Hall was subject to millions in claims related to exposure to asbestos. While in chapter 11, C.P. Hall entered into a settlement with the Liquidator for Integrity Insurance in New Jersey, and another one of C.P. Hall’s insurer objected to the settlement on the grounds that the settlement was too low and could potentially expose the other objecting insurer to more claims. The bankruptcy court held the objecting insurer did not have standing to object to the settlement between C.P. Hall and Integrity, in essence because it did not have a “dog in the fight;” any impact upon the objecting insurer was too remote and speculative. The Seventh Circuit affirmed the bankruptcy court reasoning that a party that did not suffer a direct loss as a result of the bankruptcy court’s actions did not have the right to object to the propriety of the action. Read More
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Categories: For Creditors

Life After Bankruptcy: Getting Back On Your Feet

Filing Bankruptcy and going through the discharge process can be an exhausting process. What can be even more daunting is thinking about life after Bankruptcy. Contrary to popular belief, filing Bankruptcy is not a one-way ticket to financial ruin for the rest of your life. Instead, life after Bankruptcy can be extremely rewarding – but only for those who plan properly and commit themselves to not wasting the “fresh start” that Bankruptcy offers. Below are a few steps you can take to speed up your recovery after filing Bankruptcy in Illinois. Save Money Seems like an obvious choice, but it cannot be reiterated enough how important this step is. While planning out a budget you will stick to, make sure to factor in savings. Make sure you have a set amount of money put aside each month for your savings account. This is also a nice way to build up a nice nest egg, which can be used for retirement or to cover unforeseeable financial expenditures in the future. Finally, this will show lenders that you have become more financially responsible by being capable of saving money, and not just spending it. Pay Your Bills On Time In order to show future lenders that you are becoming more responsible in your financial matters, you will need to pay your bills on time. Falling back to old habits is easy, but you must overcome those old ways in order to get new credit down the road. Future Creditors want to see that you have learned from your past mistakes. Paying your bills on time, demonstrates that you’re in control of your financial life and are able to spend within your means. Paying your bills on time, will eventually have Creditors consider you as a desirable credit risk worth taking. Choose The Right Credit Card To Rebuild Your Credit It’s unlikely that you will be able to obtain an unsecured credit card right after bankruptcy. Experts agree that another way to rebuild your credit is by obtaining a secured credit card. A secured credit card, unlike an unsecured credit card, requires you to make a deposit up front before you are issued the card. The great benefit of this is that your new credit activity will be reported to the credit bureaus and your new credit history will start building up. Eventually, as long as you pay your bills on time and show the bank you are no longer a credit risk, your secured credit card can be converted into an unsecured one. **A few warnings and things to keep in mind about secured credit cards: Always inquire if they report your payment history to the credit bureaus Stay away from those that charge high fees Don’t call those that ask you to call a 900 number (you’ll be charged for the call) Schedule a Free Consultation with our Cook County Bankruptcy Attorneys Rebuilding your credit after Bankruptcy will take some work. There are more ways to rebuild your credit after Bankruptcy. Call our Chicagoland Bankruptcy attorneys for a free consultation. Read More
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The Keep Chicago Renting Ordinance Is In Full Effect – What It Means For Creditors

The Keep Chicago Renting Ordinance is in full effect today. The ordinance was passed by the Chicago City Council on June 5, 2013. The effective date of the ordinance was September 24, 2013. The law applies to certain foreclosed rental properties within the City of Chicago. Below is a brief description of the pertinent sections of the ordinance for the creditors acquiring foreclosed properties. Registration of Foreclosed Rental Property The creditor (the new owner) of the foreclosed property must register the property with the commissioner after acquiring the property . The ordinance lists the information that must be contained in the registration, part of which, is the designation of an authorized agent. The creditor receives all notices through the authorized agent. The City of Chicago is then allowed to serve the authorized agent with any legal action initiated by the City of Chicago and in regards to the property. The registration fee is $250 and any changes to the information contained within the registration must be submitted to the commissioner within 10 days of the changes taking place. If the property is sold to a third party purchaser, you must also notify the commissioner within 10 days of the sale. Notice To Tenants Within 21 days after becoming the owner of the foreclosed rental property, the creditor must make a good faith effort to identify all tenants in the building. The owner must send all of the identified tenants a notice in English, Spanish, Polish and Chinese detailing the tenants’ possible rights to a renewal of their lease or the possible right to relocation assistance. The ordinance itself provides the language/disclosures that must be contained in the notice. A general notice must also be posted on the general entrance to the property within 21 days. Any additional tenant after the 21 day period, must have a notice sent within 7 days of the discovery of his/her identity. Tenant Relocation Assistance The creditor of a foreclosed rental property must offer a qualified tenant a one-time relocation assistance fee of $10,600. The other option is to offer the option to renew or extend the tenant’s current rental agreement with an annual rental rate that: (i) for the first 12 months of the renewed or extended lease, does not exceed 102 percent of the qualified tenant’s current annual rental rate; and (ii) for any 12 month period thereafter, does not exceed 102 percent of the immediate prior year’s annual rental rate. The relocation fee must be paid within seven days of the qualified tenant vacating the property and must be in the form of a certified or cashier’s check. The owner may deduct past due rent from the relocation fee. The owner may not deduct money from the relocation fee for any other reason other than past due rent, including damage to the property. There are severe consequences for not abiding by the ordinance. If the owner does not comply with the requirements in the Ordinance, the qualified tenant is entitled to damages in an amount equal to two times the relocation assistance fee. Read More
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